Korea Zinc to invest up to $13 bn over 10 years to boost new businesses

[Courtesy of Korea Zinc]

Korea Zinc Inc., the world’s leading company in the non-ferrous metals sector, will expand its business into new areas such as secondary batteries and resource recycling with an aim to increase sales to 25 trillion won ($19 billion) by 2033, the company said Thursday.

During an Investor Day event held in Seoul for the first time since its inception on Thursday, Korea Zinc shared its mid- and long-term business strategies and growth targets for the next 10 years.

The company said that it will maximize profits by increasing efficiency in the existing smelting business, while securing future growth drivers such as secondary batteries, resource recycling business, and renewable energy.

Korea Zinc will aim to increase sales to 25.3 trillion won in 10 years, more than double the 11 trillion won posted in 2022.

The company plans to invest 17 trillion won in its smelting business (5 trillion won) and new businesses (12 trillion won).

Korea Zinc aims to raise 10 trillion won in annual sales and generate 13 trillion in sales from its smelting business by 2033.

The company holds the world’s No. 1 position in non-ferrous metals with a share of 8.4 percent and 9.3 percent in the zinc and lead markets, respectively, as of the end of 2022.

To respond to the decline in smelting fees and the increase in electricity prices, Korea Zinc plans to enhance efficiency by integrating the production of various non-ferrous metals and products, including copper and nickel, in addition to zinc and lead, starting in 2026.

The company also announced plans to invest 12 trillion won in new businesses to respond to changes in industrial structure and the environment.

The strategy is to actively create business opportunities by selecting three areas, including secondary batteries, resource recycling, and renewable energy, as troika drive (TD) businesses.

For the secondary battery materials business, the company is expected to produce nickel sulfate, precursors, and copper foil.

In particular, with the construction of the all-in-one nickel refinery in Korea, investors expect the company’s upcoming nickel sulfate business to meet the criteria for U.S. Inflation Reduction Act (IRA).

The United States recently announced that it would designate joint ventures with Chinese capital ownership exceeding 25 percent as foreign entities of concern (FEOCs) under the IRA and exclude them from eligibility for subsidies.

Korea Zinc is considered to be relatively free from such restrictions in the U.S. government policy, as it has a low dependency on Chinese companies. “We are expected to have competitiveness in this policy, given our low dependence on Chinese companies,” the company said.

Korea Zinc expects to have an annual production capacity of 85,000 tons of nickel sulfate, 80,000 tons of precursors, and 60,000 tons of copper foil by 2033, aiming to increase sales to 5.3 trillion won.

Korea Zinc also plans to establish a resource recycling value chain, involving collecting process scraps and waste batteries generated by battery manufacturers and automakers, recycling them, and supplying them as nickel sulfate and precursors in a closed-loop value chain.

Korea Zinc acquired Igneo Holdings LLC, a U.S. electronic waste processing and recycling company, in 2022.